The IRS Market Segment Specialization Program

‘New and Improved’ Taxpayer Compliance Measurement Program?After more than three decades of constant use, the IRS is replacing the Taxpayer Compliance Measurement Program (TCMP) with more current— and user-friendly—guidance: the Market Segment Specialization Program (MSSP).The new program’s major...

By CFO Editorial Staff • March 22, 2001

Seven Tax Tips

1. Convert ordinary income to capital gains with a section 83(b) election. Section 83 imposes ordinary income tax on property (such as restricted stock, but not stock options) received as compensation for services, as soon as the property becomes vested and transferable. If you receive eligible p...

By CFO Editorial Staff • March 22, 2001

Explore the Trendline➔

Tax policy shifts: What CFOs need to know to stay ahead

Discover how evolving tax policies are creating new opportunities and challenges for CFOs.

By CFO.com staff

CFOs Sweat FASB’s Goodwill Accounting Changes, Says Study

The changes to goodwill accounting and elimination of pooling have largely been met with positive reviews from the financial community. But according to a recent Merrill Lynch study, a number of CFOs may be in for a rude awakening as they start putting the new rules into practice. Many senior fin...

By Craig Schneider • March 19, 2001

Did Broadcom Kill its Credibility?

In the last two weeks, Broadcom, a maker of semiconductors used for high-speed Internet devices, has come under an unusual degree of scrutiny, stemming from questions about how the firm recognized stock warrants issued to customers of acquired companies. The company had been in the habit of recog...

By Joseph Radigan • March 15, 2001

GAO Blasts IRS for Security Lapses

The General Accounting Office published a scathing report on Wednesday, criticizing the Internal Revenue Service for its failure to “implement adequate computer controls to ensure the security of its electronic filing systems.” Much of the report’s criticism was directed at the IRS’ e-file progra...

By Joseph Radigan • March 15, 2001

PricewaterhouseCoopers Denies IPO Report

PricewaterhouseCoopers has discredited published reports that it has definitively decided to go public. In a story in the March 15 issue of Consulting Alert, a managing partner in PwC’s global management consulting practice was quoted saying that his firm was “actively working” toward an initial ...

By Jennifer Caplan • March 14, 2001

FEI Responds to FASB

FASB’s got mail, but not necessarily fan mail. Responses to its revised Exposure Draft (“ED”), Business Combinations and Intangible Assets — Accounting for Goodwill are starting to trickle in, and the Committee on Corporate Reporting (CCR) of Financial Executives International (FEI) is one of the...

By Craig Schneider • March 9, 2001

A Virtual Close: Easy as One, Two, Three?

Not all that long ago, the term “virtual close” was obscure jargon rolling off the tongues of Cisco Systems’ CFO Larry Carter and the folks at Motorola. Today, most large corporations have either initiated the journey toward a virtual close, or made it one of their top priorities.O.K. So you’re n...

By Jennifer Caplan • March 8, 2001

FAS 133 And the New Facts of Life

The broad cross section of corporate America began adjusting its derivative contracts to reflect their fair market value at the beginning of the year, and next week, a Financial Accounting Standards Board panel charged with writing rules for derivatives accounting will hold its first meeting sinc...

By Joseph Radigan • March 7, 2001

Long Live the R&E Tax Credit

The recent economic boom owed as much to the leaps and bounds in technological innovation as it did to the leadership of President Clinton and Federal Reserve chairman Alan Greenspan. Now that the economy has taken a more sluggish turn, business is asking the government for incentives to keep inn...

By Lisa Yoon • Feb. 22, 2001

IAS Will Change U.S. Accounting Rules

Accounting standards the world over are about to get a facelift, and financial executives in the U.S. may have to make a big adjustment. The various national systems throughout the world, such as the U.S. Generally Accepted Accounting Principles (GAAP), may soon be swept away in favor of a unifie...

By Ed Zwirn • Feb. 6, 2001

Why Some Tax Shelters Could Bomb

Call it a crackdown on corporate welfare. The U.S. Treasury is dismantling two types of tax shelters that it says have been abused by companies, and proposing tighter rules for the use of legal opinions that support companies’ use of shelters. “Abusive tax shelters are the most serious compliance...

By Lisa Yoon • Feb. 2, 2001

No Place to Hide?

When Applied Power Inc. (APW) spun off its communications and electrical infrastructure services division last year, it did so in a way that will increase its earnings for years. The company decided to reincorporate in Bermuda, and thereby exclude all future foreign earnings from U.S. tax. After ...

By Ian Springsteel • Feb. 1, 2001

E-philanthropy: Internet Sours Sweet Charity

It is better to give than to receive, unless your company gets trapped in the murky waters of E-philanthropy. The practice of using the Internet to solicit or make charitable donations is innovative, but like any new idea, E-philanthropy has start-up glitches to work through, including tax questi...

By Steve Bergsman • Feb. 1, 2001

Profiting from Health-Care Cuts?

Increasing attention to the use of accounting gimmicks to boost profits has rekindled a nine-year-old controversy involving Financial Accounting Standards Board Statement No. 106. In recent months, critics have renewed charges that some companies are using FAS 106 — the standard that since 1993 h...

By Laurie Kaplan Singh • Feb. 1, 2001

Stock Option Tax on Hold

Companies plagued by the burden of collecting withholding tax on employee stock purchase plans (ESPPs) and incentive stock options (ISOs) will find some relief in a recent Internal Revenue Service announcement. As a temporary solution to a controversial issue, the IRS announced a two-year morator...

By Lisa Yoon • Jan. 26, 2001

BREAKING NEWS: International Board Seeks Global Accounting Practices

And you thought it was hard enough to learn Generally Accepted Accounting Principles (GAAP.) A newly formed group of self- described “technocrats” will soon begin working full time to bring the many accounting standards scattered throughout the world in line with each other.The International Acco...

By Ed Zwirn • Jan. 25, 2001

Rupert Murdoch Tries to Avoid a $1 Billion Tax Bill

A rare, arcane tax rule could force News Corp. to plunk down an extra billion dollars to buy Chris-Craft’s 10 television stations. Why? Just look at the $5.35 billion deal’s structure.The FCC is already questioning whether the structure violates the agency’s 1995 rule that restricts foreign owner...

By Craig Schneider • Jan. 16, 2001

Indirect TV

Judging from all the hoopla, one would expect General Motors Corp. to have divested itself of Hughes Electronics Corp.by now. After all, the subsidiary, which consists mainly of the satellite television business known as DirecTV Inc., was recently valued at $40 billion by analysts, compared with ...

By Emily S. Plishner • Jan. 1, 2001

FASB Makes Changes to Goodwill Plan

FASB is recommending that companies cease amortization of goodwill arising from prior acquisitions once its proposals for new merger- related accounting rules have been adopted. The rules will probably go into effect sometime in the third quarter of 2001. When FASB issued its recommendations two ...

By Craig Schneider • Dec. 20, 2000

FASB Board To Deal With Goodwill

On Wednesday, FASB will hold an open meeting to discuss several accounting standards topics, including issues relating to the Board’s pending decision to account for goodwill under an impairment-only approach. The agenda for the 8:30 am meeting includes:Business combinationsFASB Statement 140 imp...

By Craig Schneider • Dec. 19, 2000

Will Christmas Come Early for Corporate America?

If you have completed a merger in recent years, you may wind up enjoying a windfall, courtesy of FASB. In less than two weeks, companies that still have purchased goodwill to amortize on their books may learn that they no longer need to take further write-offs.On Wednesday, FASB recommended new a...

By Craig Schneider • Dec. 8, 2000

One Giant Step Closer to Global Accounting Standards

The adoption of uniform international accounting standards is becoming more and more likely. The latest indication: Last week’s release of a PricewaterhouseCoopers study, which showed that an overwhelming percentage of European CFOs endorse converging toward the adoption of a global framework and...

By Jennifer Caplan • Dec. 4, 2000

The Great Debate

Olli-Pekka Kallasvuo, CFO and executive vice president of Nokia Corp., seems a prince of transparency as he sits in Nokia House, a steel and glass corporate temple in Helsinki, Finland. The 47-year-old talks with confidence of Nokia’s information disclosure practices under international accountin...

By Tom Leander • Dec. 1, 2000

Hewlett-Packard Can’t See The Future

The earnings shortfall that Hewlett-Packard announced on Monday morning packed a double whammy. Not only did the company miss the Street’s earnings forecasts by a dime per share, which is longer than a country mile by Wall Street standards, but it also blamed its failure to spot the problem soone...

By Joseph Radigan • Nov. 16, 2000